Can we build a better broker?

[Damon]

I will know after my training.

I have stats on my cost as a brokerage for example, average spreads on EU is 0.4 pips over the last 250,000 trades So I would need to decide how much to tack on or how much to charge as a commission, I am keeping costs down in order to offer clients a good price, but I still need to consider risk, cost and then profits before I can tell you the spreads.

I can decide on over 70 pairs, I will see what the cost is for specific pairs, are those pairs you asked me about special pairs for some reason?

The swap rates I will increase by less than 10% this will be told to clients. I want to at least foot the bills on buy and hold strategies too, but I need to understand if there is any risk in swap rates to a broker, that way I can incorporate that too.

The Company is in Anguilla, Company #2244508 "PELLUCID GLOBAL SERVICES LTD." It owns pellucidfx.com - Registered at Namecheap.com and is the actual company for what is Pellucid FX

I am working on segregated accounts right now, banks are pretty tough to get into as they have a KYC (Know Your Customer) policy they adhere to, which makes opening new relationships very difficult, once I have some transactions in my company I will be able to get higher rated banks, the one I most want into is Barclay's, they must see transactions first though. I am just signing papers with Laiki Bank, they are the second largest bank in Cyprus... I know CYPRUS!! but at this point I will take what I can get until I prove myself worthy. But I really want to offer segregated accounts before I launch, I will keep you updated on that.

Sorry I can't be much more specific right now, the company making the website for pellucidfx.com - Registered at Namecheap.com is dying for content too, but I don't know much in the way of EXACT details until they are there.

 

[Pharaoh]

Thanks for all the info so far.

The reason for those two pairs is to check out carry trade options. Very few brokers have either and the swap rates I've seen on them are a little strange.

 

[ottober8]

Very interesting.
Some news regarding your start up?

 

[Damon]

Very interesting.
Some news regarding your start up?

Sure thing, first off, I notice you have been registered since 2007 and this your first post!.. I am honored

Pellucid FX has soft launched which means the doors are open but staff and systems are being grooved in, custom software is not implemented nor quite finished as I keep adding things... I'm like a kid in a candy store!

Pellucid has two banks currently, one is Laikie Bank and the other which I am extremely proud of is called, Caledonian out of the Caymans (Caledonian means from Scottland, LOL) It is an "A" rated (Moody's) bank and in my discussions with their compliance officer we have set up something I have wanted to set up since I was but a wee pup. Free transactions!! Basically the way it works is you set up a bank account yourself at Caledonian and you can transfer to your Pellucid FX accounts and Pellucid FX can transfer to your caledonian account(withdrawal) all without fees!.
This is now the preferred method for any payments from Pellucid FX, as a money manager I appreciate this because the brokerages I have worked with in the past were only interested in providing ways to get your money into the brokerage, getting money out was a pain. And I like to pull weekly profits from my accounts, so as a manager, I love this feature, I am sure all types of client will.
On top of that, with Caledonian you can have a proper offshore Debit/Credit Card, with no limitations, put as much as you like on it, it has fees of course like any bank card, but they are truly excellent fees as they rival my local bank card fees and this one is offshore!!! -OK, enough of that, but boy am I excited about that.

As for the custom software I have special portals for, Investors, Account Managers, Traders and Affiliates. I find this was a huge issue in previous brokerages, Investors in my accounts couldn't find their browser let alone navigate a Forex Trading Account back office, now it's easy pleasy for them with the simplified investor back office.
Another thing I am doing is allowing the trader to create as many seperate trading accounts in one account as he wants, I hated having to keep track of my EAs or trading strategies by comment, now I can just open another account, throw some funds in and it's dedicated, WOO HOO! Some people may like the old comment way, as you don't need so many platforms open, but my computer and VPS's can take it and that's the way I always wanted it.
I have some very special things for managers coming out too, but that one I am not talking about, (Brokerages trying to steal my ideas have to open a account! lol). All I can say is that customization and options you will have-a-plenty, even promotion...WHAT!?

I am working on a resource section that has tools that I used to make it as a trader, like resources that work, so that's a bit different I guess, you will see Sive in there, the page is in a bad place with crap layout really, It's on my long list of things to do better, but it's not high on the list

Another thing I am doing to do is create some custom solutions for some of the forex services I support, for example I am creating a solution for FPA so that they can run all their Forex EA tester accounts live, as Demo never has and never will tell you anything useful. So this will be cool for FPA in that I don't know any other services that run all their EA tests Live, also I am working on some cool stuff powered by MT4i (SECRETS!), so with some neat market positioning with the services and people I have come to trust I hope to gain some market acceptance and then somehow push my way to the top, dragging my comrades (that really care for traders) with me! ... have you noticed there are about a billion brokerages out there?

Don't know what else to say in terms of updates... basically doors are open, now is a good time to check it out, I am in the trenches until it is my dream brokerage, so if you contact anyone in Pellucid FX at this time I will most likely be peering into the E-mail to make sure it is handled well, Also I have programmers at hand so I can actually make changes quite fast.

Just a note on this forum that was started quite a while ago now: The new generic forex brokerage marketing campaign is; STP, Transparent, Friendly, NDD, Etc... which is what I said in the first damn post on here, that's what we as traders want! Well someone is listening! The problem is that it was only the marketers and PR guys, it is a marketing campaign! I haven't noticed any actual changes, have you?... the reason I comment on this is that Pellucid FX has similar marketing... only it's not marketing, it's what it is. It sucks that only FPA members will know who's ripped off who, but there we are.

 

[Pharaoh]

One suggestion. Forbid account managers from also being IBs to the accounts that they manage. This sort of thing can end very badly if the account manager decides to churn the account for the IB commissions.

If you want to pay managers a one-time referral fee for new accounts, that's reasonable, but letting them have any sort of per-trade pay is a recipe for at least some to turn to the dark side.

 

[Damon]

One suggestion. Forbid account managers from also being IBs to the accounts that they manage. This sort of thing can end very badly if the account manager decides to churn the account for the IB commissions.

If you want to pay managers a one-time referral fee for new accounts, that's reasonable, but letting them have any sort of per-trade pay is a recipe for at least some to turn to the dark side.

Hi Pharoah,

This is a long time battle that goes on... some IBs want no commissions for Managers in managed accounts as think it should be thiers, some managers want all commissions that would go to IB's to go to them. I have seen brokerages try to appease both side and come up with some fairly complex rules.

The way I see it is simple, Whoever brings in the client get the IB commission. I do see the managers point that he is creating the volume in the first place but I am not interested in paying a manager for volume, because Pharoah I agree 100% that a manager who gets volume based payment is one to often lured to the dark side of churning (Witness Zulutrade).
But I do not wish to penalize the manager for being a manager and not allow him to be an IB at the same time. An IB is paid for introducing the client into the brokerage, if he does that, he should be paid.

So the way Pellucid FX does it is: IB brings in client, he gets paid for that client, regardless who the IB is.

One great thing to note though Pharoah is that it will almost never be worth it for the manager to churn in this scenario, he is only being paid for volume for those clients in his account that he brought in himself. I have never seen a manager (even a very very good one) bring in enough clients on his own to make it worth it for him to churn, good managers are normally horrible IB's and most of the better managers don't give a damn about that side, they know where they make the money, and it is not in promotion, it is in production.

I still have to get you that list, I have it here somewhere, just need to edit the table and get it on here (and the site) I'll see if i can do that tonight.

 

[Damon]

Wow Pharoah,

I am sorry I did not get you that list..

It was on my to-do list and that just keeps growing, not shrinking.

I am attaching a picture of the list of supported pairs which includes current swap rates, they change all the time for us. but this is most current. I would love to get listed somewhere that tracks Pellucid FX's swaps.



Attached is the actual excel sheet, needs to be unzipped.

 

[RahmanSL]

Thanks for all the info so far.

The reason for those two pairs is to check out carry trade options. Very few brokers have either and the swap rates I've seen on them are a little strange.

Oh Ancient one, I believe you might like to check out this site for swaps comparison.... Forex Brokers Swaps Comparison | Myfxbook

 

[Damon]

Hi guys,

Thought I would give you an update, there are other places i should probably put this but then I have to be "professional".

I am so much happier being candid (professionally candid?), so I will post here

SO! hit some milestones which were cool, 1000 live accounts (3rd month a 100k deposit ( 2nd month) Paid off all costs and debt to be completely solvent (4th month)...I thought these things would be momentous, but in fact they were just numbers.

What was really cool was creating the custom software for clients:

PAMM software, now anyone can create a PAMM from an existing account or make a new one, you can have up to 3 tiers of high water mark fee (1k and up is 30% fee, 10k and up is 20% fee, etc). The managed account is audited through MT4i and available to anyone in the brokerage to deposit at the click of a button. The coolest thing about the PAMMs is that you can trade them like a normal account from any platform including mobile, the only difference is you will see deposits and withdrawals, otherwise identical to normal account. All the feeing and number crunching is taken care of by the software, As I have a manager background I built my dream managed account system

Custom IB software, I looked around at what was available and it sure was lame.
Our IB system is amazing, it is available to all live accounts and accessible in your back office, you don't need to deposit even, just open an account, go to your back office choose the account you would like your IB commissions to go to, then choose the page you want to refer to and it will create a tracking link for you to copy, (you could go one step further and use a URL shortener to track your hits)
The tracking link is awesome! It never expires, and is is a redirect so the client never see some wierd URL, when the go through your tracking link all they will see is pellucid.com as the URL, never seen another brokerage do this.
All IB commissions are instantly added to your account in real time and there is no withdrawal restrictions, withdraw same day, no problem. Most brokerages that I know you need to apply to be an IB and there is a ton of restrictions and waiting for your funds, I threw all that away

I have even sold this software to other brokerages now... that's how awesome and different it is.

Added some cool tools;
Create account: so you can try all our account types (Fixed, Variable and ECN) and have multiple PAMMs or campaign specific IB accounts, all up to client!
Transfer function: allows client to pop his funds back and forth instantly through his accounts FOR FREE (USD to USD or Euro to Euro)
Delete accounts: after he has had fun making accounts he can have fun getting rid of accounts.

Just now I am getting Liberty Reserve set up for instant deposit (funds are immediately trade-able)

So thats the fun news, the NOT SO FUN update goes like this:

First month, we had some scammer come on and deposit 32k and trade like his pants were on fire, he nearly margin-ed his first day, he,while banking balance, but in open trade draw down, requested to withdraw his profits.. "Profits only" he emphatically said... anyway, instead of margining he made 10k. We new he was trying to withdraw fast so he could claim credit card fraud, we had no idea what to do!! He cost us about $2500 already for fees and costs to our liquidity providers, he wanted his 10k, we new credit card fraud would be declared... !! ugh! we ended up sending his money because we had no policy to detect these types of things. we thought he got away with it, but then the money bounced because he had wrong details, turns out after getting the correct details and looking up the name on google that he was a member of crime syndicate JUST busted for shipping 60 stolen cars to china!!! amazing, we told him to piss off and put in detection to detect this type of thing, it became only a $2500 dollar lesson. The card was later reported stolen and they took the rest of the funds back to the card, there has been people trying to rip us off like this since then, and hence the lesson was VERY cheap.

3rd month, attacks of people hitting forums and bad mouthing us, it started with people who were not clients, easy to spot, but then we started getting people hitting our live help with crazy things and requests so they could go straight to forums and display the "snippet" to prove their righteousness on false claims. Guess that's pretty normal warfare on the interweb though... moving on.

4th month, hacker comes onto our live chat and says that he would like to speak to a manager/owner/head guy, they tell him that's impossible, he says that he would like to tell a manager that he has been hired by a competitor to take us offline, indefinitely. And just to prove that he is serious he asked the operate to check out PellucidFX.com, he had just taken it down, he left his E-mail and said if we wanted it back up we would need to pay him more than he was being payed, and he threw in the bonus that he would tell us who the competitor is. Well, I don't tolerate douche bags, I don't even associate with people I don't like, so I didn't even contact him. Instead I contacted our Server/Host (EuroVPS.com), they were furious, said the hacker took down a whole server rack with DDoS attack!! I asked how long to get online, they said no idea, he was still attacking! So I payed them 2k Euros to get me on their fasted most unlimited dedicated thing they had. They started the migration. During this time the hacker did not stop attacking and our website was nowhere to be found on the net. A while later everything was on the new dedicated-est and unlimted-est and best-est server and the hacker was still taking it down, this time the site would be intermittent, and EuroVPS said they had never seen anything like this, so we went another avenue and bought even more DDoS protection from cloudflare.com, and bam, we were safe from the attacks. The attacker came on to live chat two days later and said he needed to talk to us because that was just a taste of what he could do, he wanted more money or our site was going down permanently, he was rude to the operator and then said, "that's it I am doing it now, goodbye." and left the chat... and nothing has happened!, we saw him trying, but he couldn't take us down anymore!! I laughed because google and Youtube were successfully DDoSed the next day and were non existent for 4 hours... better than google!! Mwuhahaha!

I had another glitch with Live Support, I hired out in the beginning, got complaints because they nothing if forex or MT4, so I tried to have my team do it in house when they were not answering E-mails or writing code... yeah, basically, chat was rarely staffed because my team hated being asked newbie questions and really had better things to do, and clients were complaining that chat was rarely up, so I finally found a team of live personal that know MT4 and are happy to learn about our brokerage and be light support and great for newbies so i have them on chat 24/7 and the main guys who can do the technical answer the E-mails, seems to be all smooth and sexy now, happy staff, happy clients.

Aside from that we had the normal issues of, clients want better pricing, liquidity sources want to see volume before they will even deal with me let alone give me discounts.. so that was fun, it was a case of cart before the horse on all fronts really. Oh that reminds me, because we actually have good volume now I am dealing with liquidity providers and will be able to get lower spreads and fees, we are going to split the savings with IBs and back to clients direct. I matched the best IB fees I could find... now I want to blow the competition out of the water. Our spreads are awesome right now, but again, I want to blow the competition out of the water

As a summary: each time Pellucid FX is attacked or hits a stumbling block it grows, my goal is still better brokerage, it's just that is being realized!

Now you are up to date.

I wanted to thank FPA for letting me create this thread, this was amazing, from thread to brokerage... WOW! Thank you FPA!
Pellucid now sponsors Sive, so I guess it comes around eh?!

 

[Pharaoh]

I'm thinking that the guy with the stolen credit card is a good example for why brokers need to move away from the "open an account and start trading in 5 minutes" model towards "please give us a couple days to verify all of your documents before accepting any money from you" model. This would make it simpler to screen out frauds and would also reduce complaints from people who are legit traders, but who lack proper ID verification documents.